7 clients I manage (or used too). I ran queries for the month of March and compared 2008 to 2009:
A client which I had started his campaign in February 2008. His CPC up 4.4%, position up by a full spot.
Another client's CPC is down from one year ago by 15 cents, 37%. His position slightly down as well by 0.6 positions. This was by design to get better ROI.
Third client also with lower CPC by four cents, about 17%, also by design, in March no less. Position is down by one spot. Conversions was off by 25% so I upped the CPC back to where it was.
A campaign which nobody managed at all in that period, so a good barometer: his CPC is down almost 25%, position slightly up by 0.3
New client just last month. I don't think he put much effort into his campaign, his CPC went up by less than a cent, less than 4%. Position also improved by a full spot.
The biggest campaign I actively manage in a fairly competitive field, their CPC virtually the same (down by a fifth of a cent) as is the position. Conversions up 50%.
Finally, another former client with a poor campaign for which I have data, his CPC also virtually unchanged, now has better positioning. He got rid of a lot of poor campaigns earlier this year. Conversions up by 65% but still poor.
So on the whole, I don't see CPCs going up, certainly not 40%. I also don't normally fight for top spots, optimizing for ROI.